Report card 2011: Low risk, low reward for Fox

By IBT Staff Reporter On 12/16/11 AT 3:00 PM

This is fourth in TheWrap's series of studio report cards.

FOX

C

Twentieth Century Fox successfully rebooted two franchises, Planet of the Apes and X-Men, and built an animated series with Rio. But the studio -- now in last place in market share -- is not taking chances. A low-risk slate and tight-fisted culture is killing Fox's upside.

A year after Avatar's $2.78 billion global box office plumped up its balance sheets to record levels, Fox settled into a bland year featuring few flops and only a couple of hits, none of them the billion-dollar kind.

Through December 11, the studio reported just $2.86 billion in global box-office receipts, down significantly from the $4.5 billion it enjoyed in 2010.

Closing in on around $840 million in domestic box office revenue, Fox is banking on strong performances for this weekend's release Alvin and the Chipmunks: Chipwrecked, as well as We Bought a Zoo on December 21, to push it past the $1 billion mark for the year -- and possibly past Universal and out of last place.

Fox executives insist the studio's corporate mantra is profitability, not market share, and the company spent 2011 managing costs on the relatively modest 15 movies it released. While it might not be exciting, Fox is focusing on growing its international business.

They correctly realized that the growth is international on the movie side and they're focusing on the movies that will work in that regard, Matthew Harrigan, an analyst with Wunderlich Securities, told TheWrap.

But while Fox has one of the most stable management teams around, it is also earning a reputation for a moribund creative culture. Sequels, remakes and reboots dominate the production calendar. At least five production executives have left the studio in the past two years.

And the studio's proud reputation for pinching pennies has alienated some filmmakers and plenty of talent agents.

Rio, Rise of the Apes and X-Men: First Class were Fox's only movies to gross more than $100 million domestically in 2011, paving the way for future installments in each franchise.

Fox's newest animated franchise, the animated Rio, had particular international appeal, grossing $143.6 million domestically and $344 million internationally on a $90 million budget.

Its rebooted franchises, Planet of the Apes and X-Men, also generated solid international audiences. Rise of the Apes grossed $176.7 million domestically and $304.5 million internationally on a $93 million budget. X-Men: First Class grossed $146.4 million in North America and $207.2 million internationally. It had a $160 million budget.

X-Men: First Class, which Fox turned into an origins prequel, introduced audiences to a younger cast, and offered the studio the opportunity to make more X-Men films or break individual characters into leads of their own superhero films.

Rise of the Apes was the beneficiary of both a strong script and technological innovation, said Chris Aronson, executive VP of distribution for Fox.

Andy Serkis's performance is brilliant, and I think without that the movie wouldn't have been as effective as it was, Aronson said. All that said, it was a really good, compelling story.

Fox had only one notable flop this year, the ensemble bird-watching comedy The Big Year, starring Steve Martin, Jack Black and Owen Wilson, which grossed just $7.2 million on a $41 million budget.

If you have a flop, you'd rather have a flop like that, rather than a 'Happy Feet,' Harrigan said, referring to the Warner movie whose marketing and production costs well exceeded a $107 million worldwide box-office gross to date. Any studio is not going to have a perfect batting average, and having that be the disappointment shows you're maintaining the risk envelope pretty well.

Other under-performances were offset by modest budgets: Glee: The 3D Concert Movie grossed only $11.9 million domestically and $6.8 million internationally, for example, but the movie was made for only $9 million.

Meanwhile, the studio has a strong slate for next year: Ridley Scott's action/sci-fi film Prometheus, Timur Bekmambetov's Abraham Lincoln: Vampire Hunter, the next installment of the Ice Age franchise, the Jonah Hill/Ben Stiller/Vince Vaughn comedy Neighborhood Watch, and Ang Lee's Life of Pi look to be among the high points.

George Lucas's big theatrical 3D rollout of Star Wars also kicks off in 2012.